According to the data compiled by industry tracker Canalys, Xiaomi accounted for 31 percent of the Indian smartphone market in the first quarter, followed by Samsung with 25 percent.

The gap between the two companies widened on-quarter from the October-December period of 2017, when Xiaomi and Samsung accounted for 27 percent and 25 percent of the market, respectively.

"Xiaomi is becoming a force to be reckoned with in India," Ishan Dutt, an analyst at Canalys, said in the report. "Apart from being some of the best value devices on the market, Xiaomi's smartphones are now available in more places and in larger quantities."

"Xiaomi is now bringing this cost disruption to TVs, another consumer market that is dominated by heavyweights, such as Samsung, Sony and LG. The move will add much needed equity to its brand and will positively affect its longevity in the market," the researcher added.

The rise of Chinese players, that can take full advantage of their price competitiveness, is posing a serious challenge for Samsung's overseas smartphone business. The South Korean company accounted for 0.8 percent of the Chinese market in the fourth quarter, a separate data compiled by Strategy Analytics showed.